Re: [ga] Scope of Audit Committee Work -- Karl Auerbach's Complaints

[Jeff Williams <jwkckid1@ix.netcom.com>]

Patrick and all assembly members or interested parties,

  I also am in agreement with Patrick, Karl, and Danny in this request.
As spokesman for [INEGroup] our members request that a full
audit by both KPMG and the GAO be conducted and a full
report be presented to the DNSO GA members as well as
publicly posted.

  This request that Danny, and Karl have undertaken has occurred
before without compliance from the remainder of the ICANN BoD
and especially the ICANN CEO, one Stuart Lynn.  We are hopeful
that compliance with this request and in addition public disclosure
of the financial records dating back to July '98 be completed
forthwith.

Patrick Corliss wrote:

> Dear Stuart & Danny
>
> I refer to an email to Stuart from Danny which was dated Sat, 8 Dec 2001:
> http://www.dnso.org/clubpublic/ga/Arc08/msg03512.html
>
> This email, which was copied to the GA mailing list, was a "request for
> review" in relation to a dispute between the ICANN Board and one of its
> directors, Karl Auerbach over his request for documents.  Apparently these
> have not been forthcoming.
>
> I would refer you to the "Audit Committee Charter adopted by the ICANN Board
> on 10 March 2000 and, in particular the Scope of Audit Committee Work"
> (extract below).  The whole document can be found at the following URL:
> http://www.icann.org/committees/audit/charter-10mar00.htm
>
> In this respect, it would seem to me that ICANN has demonstrated serious
> inadequacies in its system of internal controls.  This includes ICANN's risk
> management policies.  The result may be to affect ICANN's exposure to
> contingent liabilities to a material extent (in particular, relating to
> Directors
> and Officers Liability)  (see Clause III (4) of the Scope below).
>
> It would also appear to me that ICANN's may not be in compliance with
> generally accepted accounting principles for nonprofit organizations in
> respect of its accounting and financial management systems and reports
> (see Clause III (2) of the Scope below).
>
> I therefore ask Stuart Lynn, as ICANN's CEO, to refer the issues which I
> have raised to its auditors for their urgent consideration.
>
> They are as follows::
>
> KPMG
> 355 South Grand Avenue
> Suite 2000
> Los Angeles, CA 90071-1568
>
> Thanking you.
>
> Best regards,
> Patrick Corliss
>
> III. Scope of Audit Committee Work
>
> In accomplishing its assigned responsibilities, the Audit Committee will
> review the following listed matters and such other matters as may warrant its
> attention. It may, with approval of the Board, engage additional assistance to
> undertake such reviews of financial management performance as it deems
> necessary.
>
> (1) Recommend to the Board of Directors the selection of ICANN's external
> auditors and the annual fees to be paid for services rendered by the external
> auditors, review each proposed audit plan developed by management and the
> external auditors, periodically review the performance of the external
> auditors, and recommend to the Board any proposed retention or discharge of
> the external auditors.
>
> (2) Review the Corporation's annual financial statements and reports as
> required by the Bylaws, including the compliance of the Corporation's
> accounting and financial management systems and reports with generally
> accepted accounting principles for nonprofit organizations.
>
> (3) Review and forward to the Board the annual financial management letter of
> the external auditors, with such comments of its own as may be appropriate.
>
> (4) Periodically review the Corporation's system of internal controls,
> including its risk management policy and any accompanying insurance coverage,
> and make recommendations to the Board for changes it considers desirable.
>
> ----- Original Message -----
> From: <DannyYounger@cs.com>
> To: <lynn@icann.org>
> Cc: <ga@dnso.org>
> Sent: Saturday, December 08, 2001 7:16 PM
> Subject: [ga] Request for Review
>
> > Mr. Lynn,
> >
> > My North American At-Large Director, Karl Auerbach, has once more posted a
> > series of comments regarding the "absolute right" of a Director to inspect
> > and copy corporate documents, a right that he claims you are denying to him.
> > When I hear an argument by my representative that insists that this
> > Corporation under your stewardship is engaged in applying its procedures and
> > practices inequitably so as to single him out as a particular party for
> > disparate treatment, such actions not being justified by either substantial
> > or reasonable cause, I have a legitimate right to be concerned that ICANN is
> > in violation of its Bylaws.
> >
> > As Mr. Auerbach's complaints on this subject matter have been set forth in a
> > number of fora over the course of several months, and as ICANN's failure to
> > resolve this concern continues to cast doubt upon the integrity of our
> > Corporation, this impasse now begins to affect all of us.  Accordingly, in
> > the interest of resolving this matter, allow me to request that a review of
> > the Corporation's actions with respect to Mr. Auerbach's right of inspection
> > be undertaken by the full Board.
> >
> > Please advise if you will honor such request for review.
> >
> > regards,
> > Danny Younger
>
> <snip footers>
>
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Kindest regards,

--
Jeffrey A. Williams
Spokesman for INEGroup - (Over 121k members/stakeholdes strong!)
CEO/DIR. Internet Network Eng/SR. Java/CORBA Development Eng.
Information Network Eng. Group. INEG. INC.
E-Mail jwkckid1@ix.netcom.com
Contact Number:  972-244-3801 or 214-244-4827
Address: 5 East Kirkwood Blvd. Grapevine Texas 75208


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